Proposal To Exempt Railway From NPS – Reply From Government

Proposal To Exempt Railway From NPS – Reply From Government

MINISTRY FOR RAILWAYS
GOVERNMENT OF INDIA
NEW DELHI

No. 2015/F(E) III/1/4-Part
29 Mar, 2014

Dear Shri P. Chidambaram Ji,

Through this letter, I wish to draw your attention to a long standing demand raised by both Staff Federations of Railways on National Pension Scheme (NPS) for employees of Indian Railways. The Federations have been expressing resentment over operation in the Railways of the National Pension Scheme, which is perceived as a lower social security cover for Railway employees. Their contention is that there are enough grounds for Railway employees to be treated differently from other civil employees of the Government, and that Indian Railways should operate the traditional defined benefit pension scheme available to pre-01.01.2004 appointees.

You will recall that a few organizations/categories of Government employees were specifically exempted from the purview of NPS on consideration of special, riskier and more onerous nature of duties. The Federations have been drawing parallel with of nature of duties performed by most categories of Railway employees with those in the Armed Forces. They contend that during British period, Railways was conceived and operated as an auxiliary wing of the Army. It was also realized that by virtue of its complex nature, Railways required a high level of discipline and efficiency to be able to perform its role as the prome transport mode. Railways is an operational organization required to be run round the clock through the year. Railway employees have to work in inhospitable conditions, braving extreme weather, unfriendly law and order scenario, and inherent risks associated with the Railway operations itself. As in the Armed Forces, many have to stay away from their families for long periods while performing duties in areas where adequate facilities are lacking.

I feel that there is considerable merit in the contention of the Staff Federations. Besides the critical and complex nature of duties of Railway employees, the hazards involved are also high. Despite best efforts for enhanced safety measures, a large number of Railway employees lose their lives or meet with serious injuries in the course of performance of their duties each year.

During the period 2007-08 to October 2011, the number of Railway employees killed during the course of their duty has been more than number of passengers/other members of public killed in Rail related accidents including accidents at unmanned level crossings. While the nature of duties of Railway employees is inherently high risk during peace time, they also perform functions of critical importance during war time and times of natural calamities, in moving men and materials across the country to maintain supply of essential commodities and safeguard integrity of the nation.

In my view, there are adequate grounds for the Government to consider exemption for Railway employees from the purview of NPS. The implications of this would be that Government expenditure would reduce over the next few years through discontinuance of Government Contribution under the NPS, but the long term liabilities would increase, as financial commitments in the defined benefit pension scheme would be higher. Since Railways are required to meet the pensionary outgo from their internal resources, switchover to defined benefit pension scheme would call for a more systematic provisioning under the Pension Fund through appropriate revenue generating measures. With Rail Tariff Authority on the horizon, I believe that this would be possible.

In the light of the above, I suggest that our request for exemption from operation of the NPS be considered sympathetically and necessary approvals communicated.

A copy of each demands raised by the two Federations is enclosed.

With regards,

Yours sincerely,

(Mallikarjun Kharge)
Shri P. Chidambaram,
Finance Minister,
Government of India,
North Block, New Delhi – 110001


PRADEEP KUMAR

MEMBER STAFF, RAILWAY BOARD
& EX-OFFICIO SECRETARY,
GOVERNMENT OF INDIA
MINISTRY OF RAILWAYS
NEW DELHI – 110001

D.O. No. 2012/F(E)III/1/4-pt.

Dated: 04.03.2015

Dear Shri Sanjay Kothari,

Subject:- Request of the recognized Federations (AIRF & NFIR) for exemption of the Railway servants appointed on or after 01.01.2004 from the application of the National Pension System (NPS).
************

May I draw your kind attention to a D.O. letter dated 29.03.2014 (copy enclosed) written by the then Minister for Railways, Hon’ble Sh. Mallikarjun Kharge to the then Finance Minister, Hon’ble Sh. P. Chidambaram regarding exemption of the railway servants appointed on or after 01.01.2004 from the application of the National Pension System.

2. Since, the issue is being raised repeatedly by both the recognized railway Federations (AIRF & NFIR) at various forums including JCM held in Ministry of Home on 25.02.2015 which was chaired by your good self, I would be grateful if you could kindly look into the matter and arrange to advise Govt’s decision in this regard at the earliest.

With regards.

Yours sincerely,

(Pradeep Kumar)

D.A.: One.

Shri Sanjay Kothari,
Secretary, the Department of Personnel & Training (DOP &T)
Room No. 112, North Block
New Delhi – 110001.


No. 15/28/2014-PR
Government of India
Ministry of Finance
Department of Financial Services
******

Jeevandeep Building, Sansad Marg,
New Delhi dated 4th September, 2015.

To
Vaisakh Vasudevan Pisharody
Sree Nivas, Pruthippully East,
Paruthippully, Post Palakkad,
Pin : 678573, Kerala

Subject: Application under the Right to Information Act, 2005.

Sir,

Please refer to your online RTI Application with registration number DOFSR/R/2015/81116 which was received in this Department on 14.09.2015, through transfer from the Department of Personnel and Training. In this regard, the information with respect to the Department of Financial Services, Ministry of Finance is as follows:

Points 1 to 5: Yes, Department of Financial Services, Ministry of Finance has received proposal to exempt any of the Central Government Employees from National Pension System (NPS). The proposal was received from the All India Railwayman’s Federation. In this regard, copy of DO letter No. 08-01/2014 PR dated 15.05.2015 from Adviser, Department of Financial Services, Ministry of Finance, addressed to Railway Board, Ministry of Railways, is enclosed.

2. In terms of Section 19 of the Right to Information Act, 2005, the name and address of the Appellate Authority is as follows:

Shri Sudhir Shyam
Director (Pension Reforms)
Department of Financial Services, Ministry of Finance,
2nd Floor, Jeevan Deep Building, Parliament Street,
New Delhi – 110001

Yours faithfully,

(A.K. Misra)
Under Secretary to the Government of India & CPIO


Government of India
Ministry of Finance
Department of Financial Services
Jeevan Deep Building, 3rd Floor,
10, Parliament Street,
New Delhi – 110001
Tel: 23742100 Fax: 23742207
e-mail: ssaksena@nic.in

Dr. Shashank Saksena

Adviser

Dated: 15th May, 2015

Dear Shri

Please refer to your D.O. letter No. 2012/F(E)III/1/4-Part dated 04.03.2014 regarding exemption of the railway servants appointed on or after 01.01.2004 from the application of National Pension System (NPS), a copy of which was received from Department of Personnel & Training, Ministry of Personnel, Public Grievances and Pensions.

2. The Government of India vide notification dated 22.12.2003 introduced the NPS for all the new entrants entering into Central Government service on or after 1.1.2004, and only Armed Forces have been exempted from NPS. On introduction of the NPS, among others, the Central Civil Services (Pension) Rules, 1972 and the Central Civil Services (Extraordinary Pension) Rules were amended on 30.12.2003.

3. On the recommendations of a Group of Ministers (set up on a proposal of MHA for the CPMF personnel) and after obtaining approval of Cabinet, vide Department of Pension & Pensioners’ Welfare (DPPW) OM No. 38/41/06-P&PW(A) dated 5.5.2009, the benefits of Gratuity, Invalid Pension, Family pension, Disability pension and Extraordinary family pension on par with the old defined benefit pension system have been provisionally extended to employees covered under NPS at par with the employees appointed before 1.1.2004, in the event of death/disability of the Government employee while in service. This decision of the Government adequately addresses the issue raised by Shri Mallikarjun Kharge, the then Minister of Railways in his DO letter dated 29.3.2014, that a large number of Railway employees lose their lives or meet serious injuries due to hazards involved in the critical and complex nature of their duties.

4. Further, on the issue of meeting the pensionary outgo (defined pension) from their internal resources by Railways by a more systematic provisioning under the Pension Fund through appropriate revenue generating measures, this Department is of the view that this would result in many other organisations seeking exemption from NPS on the same analogy. It may kindly be noted that earlier a proposal to exempt paramilitary forces from the ambit of NPS was referred to a Group of Ministers (GoM) and was finally not approved by the Government. This Department reiterates its earlier view that any move to exempt such organisation from the ambit of NPS, would open a pandora’s box, while increasing burden on the exchequer.

5. You will agree that moving away from the earlier defined benefit based pension system was a conscious decision of the Government taken in view of the unsustainable pension liability of the Central Government. NPS has been adopted by all State Governments (except those of West Bengal and Tripura), autonomous bodies and even big corporate houses in private sector by adopting NPS for their employees. Moreover, NPS is a low-cost, yet efficient pension system based on sound regulation. In view of the above, request of the recognised Federations (AIRF & NFIR) for seeking exemption of the Railway servants appointed on or after 01.01.2004 from the application of the NPS does not seem to be a feasible proposition.

6. However, since the personnel issues of Government employees are in the domain of Department of Personnel & Training (DoPT), Department of Pension & Pensioners’ Welfare (DPPW) and Department of Expenditure (DoE), these Departments may also be consulted in the matter.

Yours sincerely,

Sd/-
(Dr. Shashank Saksena)

Shri Pradeep Kumar
Member Staff, Railway Board & Ex-Officio Secretary
Minister for Railway
Rail Bhawan, New Delhi – 110001.

Source – http://confederationhq.blogspot.in

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